6 Tips for Splitting Expenses in Multigenerational Households

Before her mother moved in, says Hess, a financial adviser and president of Forge Wealth Management in Malvern, Pennsylvania, they agreed that she and her husband would pay all of the household’s bills and expenses and that McGee would do the family’s grocery shopping and cooking.

You should also consider the circumstances driving your decision to become an intergenerational household. Are your adult children moving into your home so they can save money to purchase their own? Are you moving into your adult child’s home to get help with daily tasks, such as preparing meals? Or are you buying a house together?

Discussing these needs and motivations can help everyone better understand the expectations up front.

2. Open a joint bank account for bills

Instead of trying to collect payments from everyone when monthly bills are due, consider opening a shared checking account where each person can make a single monthly contribution for their share of the expenses, says Delgado. Then use the account to pay all of your household’s bills. (Tip: Enroll in automated payments whenever possible to ensure you don’t miss a bill.)

Also consider opening a shared savings account to set aside a separate pot of money for unforeseen home expenses or emergency repairs, such as a broken water heater. It’s essentially an emergency fund for your home.

“If you plan for it by having everyone contribute to the group savings, you can handle those unexpected expenses more easily and with less failure,” Delagado says.

Regina Hess, left, and her mother, Theresa McGee, cook together at their home. McGee, 80, prepares all of the meals for the household.

Hannah Yoon for AARP

3. Recognize nonmonetary contributions

If a member of the household is handy and can save everyone the cost of a repairman when minor issues arise, that’s worth considering when determining their financial contribution to the household budget. “Everyone can reap the benefit of savings in what would have been out-of-pocket costs,” Delgado says.

Similarly, live-in grandparents who regularly provide child care for young grandchildren are helping their adult kids offset the cost of child care. (In 2024, the average annual cost of child care for one child was more than $13,000, according to a report from the nonprofit Child Care Aware of America.)

Croak says that arrangement should be reflected in the family ledger. “In this way, you are acknowledging and valuing this contribution, rather than making comparisons between money and ‘invisible’ labor,” he says.

4. Put the agreement in writing

Once you’ve cemented the specifics for your financial living arrangement, don’t rely on memory to retain them, says Leslie Tayne, an attorney and founder and managing director of Tayne Law Group in Melville, New York. Create a physical or electronic document that spells out the terms so everyone is on the same page and there are no surprises in the future.

Consider hiring a family law attorney to help you craft a legally binding cohabitation agreement.

5. Revisit the plans regularly

Don’t just set and forget the terms of your agreement. Circumstances can change over time.

Perhaps someone suffers a serious injury and accrues medical debt, or someone loses a job and can no longer afford to pay their share of the rent. These kinds of unforeseen events can occur, and your household’s financial arrangement may need to be adjusted.

Hess encourages multigenerational families to conduct quarterly or biannual financial reviews during which they review the household budget and identify any concerns.

6. Be prepared to handle disagreements

Bumps in the road, such as conflicting spending habits, job losses or unexpected expenses, will occur, and disagreements are inevitable. But preparation goes a long way.

“My best advice is to set clear guidelines early on so that when these setbacks arise, you can communicate clearly and effectively about how to manage them,” says Tayne.

As Croak says, “Clarity, combined with flexibility, makes the household budget resilient and helps protect relationships.”